Pak-China bilateral trade jumped to $2.09 billion, showing an upward trend in economic interaction between the two countries in the recent years.
The China's customs department said these figures were recorded in 10 months ie from January to November 2003, adding in the preceding year, the trade volume was 1.8 billion dollars.
The rise occurred mainly due to Pakistan's import from China in the shape of construction machinery that was being used for implementation of Chinese-funded development projects.
Meanwhile, China's total financial commitments to Pakistan during the last three and half years have reached more than $6 billion to help in implementing important public sector projects.
Official sources told APP in Beijing that these commitments were made in the shape of grant, credit or direct investment, adding the projects have already been identified and necessary agreements, contracts or MoUs have been signed, while some of the projects are under implementation or at the negotiating stage.
About the break-up of $6 billion overall Chinese support programme to Pakistan, the sources said this includes, $1 billion Neelum-Jhelum hydro power project, $700 million Pakistan Steel Mill expansion, $600 million Pakistan Railways rehabilitation, $600 million Thar Coal, and $500 million Jherruk Sonda Coalmine project.
There were half a dozen other hydropower projects, which include Jinnah hydropower, Golan Gol hydropower project, and Keyal Khwar Hydro power, they said, adding there are also small hydropower projects, including Pakpattan, Machai and Muzaffargarh-Kati grid and transmission line.
Sources said the projects for which the Chinese companies have pledged about $3 billion assistance, and are already under implementation, include Gwadar white oil pipeline, Saindak and railways rehabilitation.
The projects that are at various stages of negotiation. These include proposed Chashma Nuclear Power Plant-II, revival of Karachi Circular Railway, Thar Coal, Duddar Zinc Mine, and setting up Telecommunication University, Information Technology Park and Pakistan Steel Mill expansion project, said the sources.
They said it reflects that China emerged as a Pakistan's major partner for carrying out the development programmes of the national importance.
China's direct new foreign investment in Pakistan has also exceeded $200 million during the last three years, which was itself an unusual phenomenon in the development of bilateral economic relations, they added.
During the recent visit to China by President Pervez Musharraf, the Chinese government announced to provide a credit $500 million on highly soft-term basis to further increase investment activities in Pakistan, said the sources.
There are about dozens of Chinese companies, including Haer Electronic, ZTE Corporation, Dongfong Automobile, MCC and Sino-Trans, which are making direct investment in Pakistan.
Sources said the $6 billion financial assistance does not include $2 billion worth contracted projects, which are being participated by the Chinese companies through international bidding and foreign loans by various regional and international institutions.
More and more Chinese companies are showing interest, seeking investment opportunities in Pakistan. So far, more than 40 Chinese companies are engaged in contracted or joint-venture projects, while nearly 100 companies have business contacts and engagements with the Pakistani companies.
A senior official of the Chinese commerce ministry hoped that the balance of payment position, which is currently in favour of China, will improve after the Preferential Tariff Agreement (PTA).
He said the PTA would provide a better access to the Pakistani products in the Chinese market, adding the two countries will offer each other special tariff treatment, which is to be more preferential than most-favoured-nation (MFN) tariffs.
A formal document was signed in Beijing last week that allowed the two countries to give tariff concession on certain items. The document was signed by Zhu Hong, Deputy Director General, Department of International Trade Economic Affairs, while Pakistan side was represented by Shahid Mahmood, commercial counsellor in Pakistan Embassy.
The two sides have exchanged the lists of items so that the PTA comes into operation from the start of new year. As per agreement, China will allow tariff concession to Pakistan on 893 items, whereas Pakistan agreed to give concession to China on nearly 200 items.
Sources said on average the mutual tariff concession out of the fresh agreement with China would be 27 percent, while on some items, the duty will be almost zero percent, adding on made-ups and ready-made garments, China has agreed to reduce duty from 25 to 18 percent and from 21 to 15 percent on most other items.
On Leather goods, the reduction was mostly 25 percent. For mangoes the tariff has also been reduced considerably.
They said the PTA is a part of common desire of the two countries bringing their bilateral trade in conformity with their excellent diplomatic and defence relations.
In the private sector level, there is still a great room boosting the exports, particularly of non-traditional items, like sport and engineering goods, handicrafts, furniture, surgical instruments, marble, onyx, jewellery and agro-based products, they added.
Sources suggested that the Pak traders need to explore new opportunities in the Chinese market, as Pakistan also needs to strengthen its basic infrastructure, saying the country has yet to establish its Consulate office in Shanghai, which is the major economic center, catering almost 60 percent of the import-export business.
They said Pakistan also left behind acquiring necessary quarantine certificates to export their food products to China, adding only recently Pakistan got the permission of exporting mango to China.
According to the Embassy's sources, Pakistan has also applied for seeking quarantine certificates for the export of some other food items, like rice, Kino and dates.
Recently, Pakistan embassy held seminars in Shanghai and Beijing, which proved very successful, brining more and more Chinese investors in the country.
The sources suggested that Pakistan should hold single-country exhibition in China to introduce its non-traditional products, besides, arranging a conference of the Chinese businessmen for providing them a first-hand knowledge about the investment opportunities in the country.
The two sides believe that the bilateral co-operation on the government-to-government level has been excellent over the years. Whereas the economic interaction at the private level could not proceed ahead with a satisfactory pace. After China's entry into WTO, the development of economic ties between the two countries is mostly depending on the performance of the private sector.
China is now emerging as the largest market in the world, providing a lot of competition and opportunities. Expansion in Chinese market coupled with Pakistan's long-standing relationship could help achieve the required targets establishing a comprehensive partnership.
According to the sources, China's entry into WTO provides excellent opportunities to Pak businessmen to set up their business outlets in the Chinese market, adding China has been liberalising trade for over two decades. China has recently cut down its import tariff from 15.3 percent to 12 percent, among which the industrial products average tariff rate fell from 14.7 percent to 11.3 percent, and farm goods rate dropped from 18.8 percent to 15.6 percent.
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